Real estate group Airport City has announced its entry into Israel’s hotel management and operations sector, establishing a hotel management company together with Avia Magen, the former CEO of the Fattal Hotels chain. The new chain will be jointly owned in equal shares by Magen and Airport City through a limited partnership.
Magen stepped down from her role as CEO of Fattal Hotels after reaching what was described as her career ceiling and failing to receive an equity stake from the company’s owner, David Fattal, who chose instead to appoint his two children to key positions.
Magen convinced Airport City’s owners that there was room for the establishment of a new hotel chain in Israel, with strong prospects for success if international tourism returns to the country.
The investment in the new chain is estimated to be at least NIS 1 billion. It will include 1,100 rooms across five five-star luxury hotels: The Sarona Tel Aviv Hotel, featuring 800 concept rooms designed for the high-tech sector; the Hamoshava Hotel in Haifa; the Haleom Hotel in Jerusalem; Sha’ar Hayam in Netanya; and a luxury hotel with 90 suites in Eilat.
The Eilat hotel will be built alongside the Princess Hotel, which is currently undergoing major renovations. The hotel was purchased a decade ago by Kobi Maimon and Haim Tsuff, the owners of Airport City, from the Tessler family of Germany.
The hotel was previously expected to be acquired by the Isrotel hotel chain, but the deal was cancelled due to competition authority concerns over market concentration. The renovated hotel will include 420 rooms and suites. Magen will lead the establishment of the management chain, which will serve as Airport City’s hotel division.
In a statement to the stock exchange, the company said the move complements and aligns with Airport City’s core real estate activities, allowing it to leverage its advantages as the owner of several hotels by consolidating key headquarters functions - including marketing, procurement, human resources, technology, finance, and reservations - under a single management company.
Kobi Maimon and Haim Tsuff said: “Entering the hospitality sector marks a significant strategic step for Airport City. It was important for us to launch this activity with a partner who brings proven experience, outstanding management capabilities, and a long-term business perspective.
“Avia Magen is one of the most respected and experienced executives in Israel’s hotel industry. Our decision to establish the management company with her as a partner reflects our confidence in her ability to lead, together with us, the development of the group’s hospitality operations.”
Magen added: “The establishment of the company provides an opportunity to build, from the ground up, an organizational culture, professional standards, and a hospitality concept suited to the hotel industry of the future. We are embarking on this journey with a high-quality portfolio of luxury hotels across Israel, led by the Princess Hotel in Eilat.”